A CP16 Notice means that the IRS calculated that you should get a bigger refund than you claimed but they’re applying that refund to another tax debt.
Why did you get a CP16 Notice?
A CP16 Notice is usually the result of a math error or other miscalculation that led to you paying more taxes than you should have. The IRS computers double-check your math and will often automatically correct these types of errors.
Even if your refund is bigger now, the IRS may still owe you more money. You usually won’t get a CP16 notice because there was an additional deduction or credit you could have taken but didn’t. The IRS doesn’t have all the information it needs to check your eligibility, so you can often only find missed deductions or credits through your own research or with the help of a tax professional.